Battered but resilient economies
Three-quarters of all respondents, and more than 90 percent of those in the eurozone, expect their nations’ GDP to fall in 2009. This is an increase from November, when 59 percent of all respondents expected GDP to fall. Given that opinion, it’s not surprising that executives indicate that their nations’ economies are bad and that they have low expectations for the near term. Notably, however, those views have remained fairly stable between December and January, after falling markedly between November and December (Exhibit 1).
This may indicate a belief that the economy has hit bottom and that even tens of thousands of layoffs and continued steep losses in shareholder value aren’t worsening the situation. Some 40 percent of respondents expect an upturn to begin by the end of this year. Many executives are betting on the United States to lead that upturn, whenever it comes; more than a third say the upturn will start in North America, followed by 26 percent who expect it to start in several regions at once.
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